U.S. appeals NAFTA decision on lumber

WASHINGTON The Bush administration said Wednesday it will appeal a NAFTA dispute panel's finding that imports of Canadian softwood lumber pose no threat to American companies.

U.S. Trade Representative Robert Zoellick said the administration will take its case to a special three-judge panel, composed of two Americans and one Canadian, formed under the North American Free Trade Agreement with Canada and Mexico.

In August, the NAFTA dispute panel said the United States had failed to justify placing tariffs averaging 27 percent on Canadian lumber since 2002, and ordered them rescinded.

The U.S. International Trade Commission voted last month to comply with the NAFTA ruling but said it disagreed with the finding.

A spokesperson for Zoellick said Wednesday that U.S. officials believe the NAFTA panel ''seriously misapplied the standard of review'' in ordering the ITC to come up with its no-harm finding.

''There were also other irregularities that we intend to draw to the (appeals panel's) attention,'' said Neena Moorjani, a spokesperson for Zoellick.

Canada's international trade minister, Jim Peterson, called the U.S. action expected.

''We will continue to fight for the interests of our softwood lumber industry and for Canadians,'' Peterson said in a statement. ''All along, Canada has maintained that the American industry is not injured by Canadian softwood. Our position will not change.''

Softwood lumber encompasses easy-to-saw pine, spruce and other wood used to build homes.

The Commerce Department in June proposed cutting the tariffs in half, to 13.2 percent, though there's been no final decision.

The Coalition for Fair Lumber Imports, a U.S. industry group, applauded Zoellick's action.

''We wholeheartedly support this initiative to correct unauthorized, egregiously defective action by the NAFTA panel,'' said coalition Chair W.J. ''Rusty'' Wood. ''We are confident that the judges ... will not accept this aberrant outcome.''